Risky Academic Business

The management of risk has long been an area of interest at CEI, so we will be watching with interest the development of a new position at the University of Cambridge: professor of risk.

What are the odds of being poisoned or marrying the wrong person? How dangerous is it to catch a plane? Is it worth taking a punt on the stock market? Whether it’s health or wealth, we’re expected to weigh up the risks of everyday living.

But even though we might be given the statistics, it’s not always easy to put such numbers into a meaningful perspective.

So in an attempt to help people and institutions make sense of statistics, the University of Cambridge is creating a new professorship, the Winton Professor of the Public Understanding of Risk.

Funded by a £3.3m donation, appropriately from a hedge fund manager, the professorship will “play an important role in clarifying the understanding of risk in many fields of human endeavour”.

“The way to confront risk is via mathematics and statistics,” says Professor Geoffrey Grimmett, head of the Department of Pure Mathematics and Mathematical Statistics.

And the challenge for the new professor will be to help the public to navigate the numbers thrown at them.

“People are bombarded with information – but how do they reach a useful mind-frame to guide their decisions?”

Of course, there is more to making risk-management decisions than mere numbers, since individual subjective preferences are always a factor. But this area of study may hold promise in helping to mitigate public panics that spread among the public due to political activist propaganda and sensationalistic media coverage. And it could potentially provide help in making some important decisions — and to looking at old questions in new ways.

There’s even a suggestion that the rules of risk could be applied to finding a partner.

“If a 29-year-old man decides to marry his girlfriend of three years, what is the chance that he will meet a more suitable partner at a later stage?”

In a “mathematical idealisation” the answer is to “interview a certain proportion of the candidates without making an offer, and then to appoint the first person who is better than all those seen so far”.

Such a ruthless approach could have its own serious health risks too.

(Thanks for Megan McLaughlin for the news tip.)